Paper Number

1067

Paper Type

Short Paper

Abstract

This paper delves into the pivotal role of Generative Artificial Intelligence (AI) in harnessing network effects, offering a solution to the classic "chicken-and-egg" dilemma. Network effects, characterized by the increasing value of a product or service as its user base grows, are crucial for success in the contemporary digital landscape. We use dynamic system and agent-based models to show the impact of AI-driven bots on the online platform growth, comparing two marketplaces one with bots (Marketplace A) and one without (Marketplace B). By using synthetic data, we demonstrate that Generative AI showcases a revolutionary potential to amplify network effects. Finally, we evaluate the economic value of using AI bots and compare it with a platform solely based on user-generated content and organic user growth. The results imply that the economic values of the two marketplaces are converging in total.

Share

COinS
 
Jun 14th, 12:00 AM

Leveraging Generative AI for Amplifying Network Effects and Resolving the "Chicken-and-Egg" Dilemma

This paper delves into the pivotal role of Generative Artificial Intelligence (AI) in harnessing network effects, offering a solution to the classic "chicken-and-egg" dilemma. Network effects, characterized by the increasing value of a product or service as its user base grows, are crucial for success in the contemporary digital landscape. We use dynamic system and agent-based models to show the impact of AI-driven bots on the online platform growth, comparing two marketplaces one with bots (Marketplace A) and one without (Marketplace B). By using synthetic data, we demonstrate that Generative AI showcases a revolutionary potential to amplify network effects. Finally, we evaluate the economic value of using AI bots and compare it with a platform solely based on user-generated content and organic user growth. The results imply that the economic values of the two marketplaces are converging in total.

When commenting on articles, please be friendly, welcoming, respectful and abide by the AIS eLibrary Discussion Thread Code of Conduct posted here.